Inside the job of a Financial Analyst : Understanding the essential skills and traits

Financial Analysts are now fundamental profiles for most companies, many important decisions (mainly financial decisions) rely entirely on their work.

These jobs are growing by 23% from 2010 to 2020, faster than most other jobs, which says a lot about their relevance for most businesses.

Financial analysts guide people and businesses in making investments. They analyze the information they get from the stock market, investment portfolio prospect, company annual reports and conjure up plans for investing or not investing. Financial analysts meet with companies leaders and individuals, write reports and work with a wide range of people and financial institutions.

At the heart of Financial Analyst duties, is the ability to determine the best use of resources to achieve business objectives. They will be expected to produce regular reports using financial data, and work collaboratively across the entire finance team to analyze business performance and strategy. A Financial Analyst also forecasts future revenue and expenditures to help determine budgets for upcoming projects.

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Insights :

Through our analysis we gathered information about Financial analysts profiles around the globe, here are some of the most relevant insights we drew:



To be a good Financial Analyst, one should master many important skills starting with basic ones like Finance, Accounting, Management, Audit, etc. and moving on to more specific skills like Financial Modeling, Forecasting, Financial reporting, and Strategic planning. Below we try to explain some of the top 10 skills these profiles should master :

  • Financial modeling: Consists of building an abstract representation (a model) of a real-world financial situation. It is a mathematical model designed to represent a simplified version of the performance of a financial asset or portfolio of a business, or any other investment. This is an essential skill for Financial Analysts that allows them to evaluate the financial health of the company or specific business units or projects and ensure a predictable financial representation of the business.

  • Financial reporting: This is the process of producing statements that disclose an organization's financial performance and financial position over a specified period of time to the various stakeholders (investors, creditors, public, debt providers, governments & government agencies, etc.). Financial Analysts are often solicited to produce such statements whether externally or internally for governance and investment performance review.

  • Strategic planning: Any business big or small needs a financial strategy that establishes how the company will use and manage its financial resources to pursue its objectives. This process helps Financial Analysts plan the different financial aspects of a business or project (revenue and expenses, investment decisions, capital budgeting, cash management, etc.) and wisely allocate financial resources accordingly.

  • Forecasting: Is about making predictions of the future based on past and present data most commonly by analysis of trends. One of the Financial Analyst duties is estimating/predicting how the business will perform in the future. In financial terms, they need to forecast revenues, expenses, gross margins, etc.

  • MS Excel: Part of Microsoft Office suite, Excel is a spreadsheet featuring calculation, graphing tools, pivot tables, and macro programming language VBA. Excel is an invaluable source for financial data analysis. Every day, an uncountable amount of financial data is analyzed by Financial Analysts using this tool which makes it an essential asset to master.

After talking about the top 10 skills Financial Analysts need to succeed in their job, it's time to see what are the companies with most paid Financial Analyst paths. Through our analysis we create the chart bellow ranking the top 10 companies for Financial Analysts :

Now that we've learned about top skills and companies for Financial Analysts, it's time to look at their early beginnings and see how they kicked off their careers. As our analysis reveals, many Financial Analysts start their professional careers in Finance, Accounting or Audit. Below are some of their most frequent first job titles.

 

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